Brent rangebound in 'tug of war'

The front-month ICE Brent contract has been broadly rangebound and gained $0.46/bbl on the day, to $76.64/bbl at 09.00 GMT.

PHOTO: Getty Images

Upward pressure:

Brent has been trading broadly flat in the past day, as the market awaits any new notable catalyst, says OANDA’s market analyst Craig Erlam.

“It remains in the trading range between $70-$80 in Brent and showing little sign of breaking in either direction at this stage,” he added.

Brent values have inched upward with with little momentum since the start of the week. Market analyst Stephen Innes has attributed the lack of big price movements to a “short-term tug of war mode”.

“China’s economic headwinds have clashed with increased People’s Bank of China’s (PBoC) policy support,” said Stephen Innes.

Downward pressure:

Concerns over China’s crude demand outlook has kept the oil market on its toes. Brent has seen some downward pressure after China cut its benchmark lending rates. China lowered two benchmark lending rates by 10 basis points each, Reuters reported earlier today.

"Oil traders may need to see a materialized strong economic rebound in China to improve their outlook on oil demand," said Tina Teng, a markets analyst at CMC Markets.

"The rate cuts were widely expected, hence it did not offer a bullish push to the oil markets," she added.

China has been making efforts to boost its economy even though rising concerns about its post-Covid recovery have prompted a number of major banks to lower their 2023 gross domestic product (GDP) growth forecasts for China.

By Aparupa Mazumder 

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